The clock is ticking: old collective marks must be converted before 23 March 2020
Legislative Decree 15/2019 entered into force on 23 March 2019, implementing EU Directive 2015/2436, which regulates, among other things, new EU certification marks. The decree also provides for a transitional phase, during which owners of national collective marks registered pursuant to the previous legislation can submit a request to the Italian Patent and Trademark Office to validate their existing collective mark or convert it into a certification mark.
The old law: a peculiar Italian system
Certification marks are a new type of trademark in Italy (and at EU level). Although they already existed in some countries – namely, in the United Kingdom, certification marks were originally created and developed under British law.
The recently introduced EU certification mark is defined as a sign that is:
capable of distinguishing goods or services which are certified by the proprietor of the mark in respect of material, mode of manufacture of goods or performance of services, quality, accuracy or other characteristic, with the exception of geographical origin, from goods and services which are not so certified. (Emphasis added.)
The previous Italian Trademark Law included provisions regulating so-called ‘collective marks’, whose functions included that of guaranteeing certain characteristics of goods and services.
Article 11 of the Italian Code of Industrial Property, which regulated collective trademarks, stated:
Entities whose function is to guarantee the origin, the nature or the quality of certain products or services may obtain the registration of specific trademarks as collective trademarks, and have the right of allowing the use of such trademarks to producers or traders.
Moreover, the Italian legislation on collective trademarks included an important exception to the general prohibition of registering signs consisting only of descriptive indications designating the geographical origin of the products. Article 11.4 expressly stated:
Notwithstanding the provisions of art. 13, paragraph 1 [the article prohibiting registration of geographical names], a collective trademark may consist of signs or indications which may serve, in trade, to identify the geographical origin of the goods or services.
The new law: a substantial reform
Collective marks have therefore functioned in Italy as a sort of consumer guarantee and have been widely used to protect the geographical origin of products – a key issue in Italy due to the longstanding tradition of producing high-quality food and agricultural products connected with specific areas of the country.
The innovative scope of the reform lies in distinguishing the new certification marks from collective marks. The decree introduces the burden for owners of collective marks registered under the old law to convert each registration into either a new collective mark or a certification mark.
The request for conversion must be filed by 23 March 2020. In the absence of a request for conversion by the deadline, existing Italian collective trademarks will be cancelled ex officio.
However, while the different nature of certification marks and collective marks is clear in relation to EU trademarks, it may not be equally clear in Italy. This is due to the traditional use of collective trademarks in Italy as signs certifying the quality of goods and services – a function that was not prohibited by Article 11 of the Italian Code of Industrial Property, which did not distinguish between certification marks and collective marks.
The potential overlap between collective marks and certification marks in Italy is further increased by a peculiar provision of the Italian Trademark Law. While an EU certification mark cannot be used to certify the geographical origin of products and services, as far as geographical names are concerned, the Italian system provides for certification marks under substantially the same exceptions provided for collective marks. Under the EU system, the function of designating the geographical origin of the goods or services is restricted to collective marks only.
Collective and certification marks: who can register them?
Under the new Italian decree, the main distinction between collective marks and certification marks is who can register them. Only public entities and associations of manufacturers, producers, service providers or traders – excluding not-for-profit companies – are now entitled to register collective trademarks.
A certification mark can be registered by natural or legal persons, including institutions and public authorities, in order to guarantee the origin, nature or quality of certain products or services. However, certification mark owners must not carry out any activity involving the supply of the certified products or services.
When registering collective marks or certification marks, regulations concerning how they should be used and how misuse will be penalised should be filed.
Finally, an ‘open door’ principle with respect to geographical collective trademarks has been introduced. The new wording of Article 11, paragraph 4 specifically provides:
Any person or entity whose products or services come from the geographical area in question has the right both to make use of the trademark and to become a member of the trade association that owns the trademark, provided that it meets all the requirements of the corresponding regulation.
Beware of the deadline
The deadline of 23 March 2020 requires immediate attention by the owners of existing collective trademark registrations and raises several critical issues.
A significant number of collective marks are currently registered in the name of entities that are no longer entitled to acquire or maintain rights in trademarks of this kind, as they are somehow involved in economic activities. This situation may require urgent attention, should the trademark owner intend to validate the existing registration before March 2020.
Compared to the previous ‘closed door’ system, the compulsory ‘open door’ system introduced to regulate the free use of geographical collective marks in favour of producers whose products or services originate from the relevant geographical area is also likely to have a significant impact on the strength and value of the mark.
Nevertheless, a ‘closed door’ system is still allowed, given the possibility of obtaining similar geographical protection through a certification (rather than a collective) mark. This Italian scenario differs completely from the EU one, where certification marks cannot be used to certify the geographical origin of goods and services.
However, a geographical certification mark that is valid and enforceable in only a single country may be of little commercial interest. The benefits that it will grant may not be sufficient to justify the complex and expensive testing and supervision that the certification mark owner will be required to perform in Italy.
Collective marks have often been perceived in Italy as signs certifying quality. This function is now fulfilled by certification marks only. In the future, collective marks may lose their quality appeal in the eye of consumers. Their main remaining function will be a distinctive one, identifying the user of the trademark as a member of an association of manufacturers, producers, suppliers of services or traders.
In summary, the decree introduces new tools that may prove useful to both consumers and trademark owners, and may offer new opportunities. However, it requires careful review and an in-depth case-by-case analysis of the possibility of maintaining collective marks that have been registered under the old law.
This is an insight article whose content has not been commissioned or written by the IAM editorial team, but which has been proofed and edited to run in accordance with the IAM style guide.
Copyright © Law Business ResearchCompany Number: 03281866 VAT: GB 160 7529 10